Industry leaders urge Budget 2026 to rationalise TDS and TCS, clarify crypto taxation, and offer middle-class relief.
As India prepares for Budget 2026, industry leaders across finance, fintech, and digital assets are outlining expectations for tax reforms, improved compliance mechanisms, and measures to support innovation-led sectors.
TDS and TCS rationalisation
There is broad consensus among experts that streamlining Tax Deducted at Source (TDS) and Tax Collected at Source (TCS) provisions could significantly reduce compliance friction while enhancing transparency.
Sarvjeet Virk, Co-founder and MD of Finvasia, emphasised that rationalising these thresholds could boost ease of doing business and investor confidence.
Karthik Narayan, Vice President (Tax & Transition) at Stellar Innovations, noted that regular updates to TDS and TCS rules would prevent taxpayers from being pushed into higher tax brackets due to nominal income growth, while promoting compliance and savings.
Simplified reporting and aligning rates with realistic income and transaction levels are expected to be key measures under consideration.
Digital assets: Crypto sector seeks clarity
The cryptocurrency and virtual digital assets sector is hoping for clearer regulations and a calibrated approach to taxation.
Sumit Gupta, Co-founder of CoinDCX, suggested reducing the TDS on crypto transactions from 1% to 0.01% to discourage offshore migration and improve domestic compliance. He also emphasised aligning capital gains tax with income tax slabs and allowing loss offsetting to support responsible investment.
Nischal Shetty, Founder of WazirX, highlighted the need for clear compliance standards and reporting obligations to strengthen investor confidence.
Edul Patel, CEO of Mudrex, noted that Indian crypto investors have matured from hype-driven trading to a disciplined, long-term approach. He suggested that reducing TDS to 0.1% and allowing loss offsetting could lower friction, encourage responsible participation, and support a transparent and compliant domestic ecosystem.
Raj Karkara, COO of ZebPay, stressed that consistent regulatory clarity would help build investor trust and enable businesses to operate responsibly. Rationalising the current 1% TDS and reviewing the flat 30% tax on virtual digital asset gains, aligned with other asset classes and allowing loss set-offs, would create a balanced and predictable investment environment.
Middle-class tax relief
Experts expect Budget 2026 to address equity in personal taxation.
A proposed new tax slab of 25% on net incomes between ₹30 lakh and ₹50 lakh is aimed at providing proportionate relief, while the 30% rate would remain for top earners.
Nehal Mota, Co-founder and CEO of Finnovate, recommended raising standard deductions for salaried employees to ₹1 lakh and enhancing long-term capital gains exemptions to support middle-class taxpayers.
Proposals also include allowing housing loan interest deductions under the new tax regime and increasing relief on interest income and health insurance for senior citizens, all intended to make taxation fairer and more growth-friendly.
